Consumer Finance Protection Bureau (CFPB) Director Chopra announced a Notice of Proposed Rulemaking (NPR) to address agency concerns with residential Property Assessed Clean Energy (PACE) loans. These loans tie the debt for energy efficient home renovations—solar panels and climate resiliency upgrades among them—to the property’s tax assessment.

Proposed SEC climate change risk disclosures could qualify U.S. companies for a waiver from compliance with the EU corporate sustainability reporting requirements that were adopted by the EU in December 2022. The deciding factor may be the reporting of scope 3 emissions, those that are associated with the value chain—both suppliers and end-users—of a company’s product or services.

On April 12, the EPA announced its proposed emissions standards for vehicles built from 2027, with the National Highway Traffic Safety Administration (NHTSA) to also propose an update to the Corporate Average Fuel Economy (CAFE) standards soon. Major manufacturers have already embraced the transition to electric vehicles (EVs) that would meet the new standards and avoid 7.3 billion tons of global warming emissions through 2055.

On Monday, March 20, President Joe Biden used his first veto to strike down House Joint Resolution 30 that would have disapproved the Department of Labor’s final rule allowing fund managers to consider Environmental, Social and Governance (ESG) considerations in their investment decisions in 401(k) and retirement plans.

SFA has released the results of its second biennial ESG Market Survey that tracks the extent to which environmental, social, and governance (ESG) disclosure metrics are incorporated, or are being considered for incorporation, within the structured finance market. Survey data from 2022 can also be compared to data from 2020, revealing how sentiment regarding ESG disclosure has evolved over the past two years.

Participants in the Federal Reserve’s climate stress test pilot program—Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley and Wells Fargo—have received instructions on how the program will be conducted and what information will be gathered. The exercise, which follows the Fed’s September 30 announcement, will run until the July 31. The pilot program takes a two-prong approach, the first of which addresses the impact of physical risk—floods, wildfires, hurricanes—on assets in their commercial and residential real estate portfolios.

At the Symposium on Central Bank Independence, Federal Reserve Chair Jerome Powell emphasized his stance that climate change is not in the direct purview of the Fed’s responsibilities and will tread lightly when developing bank guidelines related to climate.

On January 5, 2023, on behalf of our investor members SFA submitted a letter to Fannie Mae and Freddie Mac (the GSEs) in response to their proposed single-family Social Index.

On December 2, the Federal Reserve Board (Fed) proposed new principles for how banking institutions should manage climate-related financial risks. The proposed principles would apply to banking organizations with more than $100 billion in total assets and are aimed at tackling both the physical risks and transition risks associated with climate change.

The Financial Conduct Authority (FCA) announced new rules that, if adopted, would include sustainability labels and restrictions on the use of “ESG”, “green” and “sustainable” to describe investment products.